Purchasing a Home vs. a Low Credit Score
When a lender considers approving your mortgage application, it goes something like this: What is your credit score? What is your credit history? What is your income? How much debt do you have? How much will your down payment be?
A huge down payment may dilute the negative effects of a spotty payment history or low credit score. However, be prepared for high fees and mortgage interest. In fact, the minimum score needed to purchase a home has increased in the past 12-18 months.
You cannot hide from a low credit score. In order to purchase a home, it is necessary to have a good credit history, whether you can provide a large down payment or not. A prospective homeowner should attempt to obtain an average credit score of 758 in order to receive the lowest interest rates, according to CNN.com.
How to Obtain the Minimum Credit Score for a Mortgage
With minimal effort you can obtain your report and see exactly what is there. Often there will be mistakes or errors that you can dispute.
You can start with a dispute letter to the credit bureau(s). Otherwise, you will have to work directly with the creditor to resolve the mistake.
A well-written dispute letter will often result in the correction of the credit report, i.e. the removal of the negative entry. It is to be noted though that investigative techniques are often careless and error prone.
This is because credit bureaus must spend potential profits on time and resources to investigate any dispute. The unfortunate truth is that some credit bureaus have found it cost effective to delay or ignore your dispute. Their hope is that you will give up on your dispute.
Will it Take Long to Boost My Credit Score?
Many people want to know how long it will be before they can see a difference in their credit score. In most cases, a fair estimate would be 6-12 months.
This is a long time but it certainly beats 7-10 years for the negative information to be dropped. It is beneficial to wait 6-12 months to raise a low score, especially when purchasing a home.
We raised our credit scores from the upper 500 range to 745 and 763 in under six months and got approved for our dream home. Discover the one rule you must obey in credit repair by seeing proof at www.creditforcouples.com and get the real truth about lexington credit repair.
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